China Wind Stocks

Jeff Siegel

Written By Jeff Siegel

Posted November 22, 2010


According to the most recent China Wind Power Outlook, that’s how much online wind capacity China could reach by 2020.

Just to give you an idea of how much power that is, 239 gigawatts is the equivalent of 13 times the current capacity of the Three Gorges Dam!

This is huge.

Meanwhile, new wind capacity in the U.S. was down a whopping 71 percent in the first half of 2010.  And much uncertainty lingers for 2011.

My friends, when it comes to wind energy development, the Chinese are running a marathon while we’re still trying to tie our shoelaces…

We already knew that China led the world in newly installed wind power in 2009. That’s when the Middle Kingdom reached a capacity of 13.8 gigawatts by installing roughly one new turbine every hour.

So to suggest that China could boast 239 gigawatts of wind power by 2020 is not that far-fetched.

And it’s the reason we’re looking primarily to China for wind power profits in 2011.

Where the wind blows in 2011

I’ll be honest. I’m not very optimistic that the U.S. wind energy industry will get much support from Washington in 2011.

Sure, there will be plenty of rhetoric about energy security and independence, and I’m confident that we’ll see a national renewable energy standard.

But since fossil fuel interests control the puppet strings in Washington, it is very likely that the wind energy industry will spend most of 2011 begging for scraps while we print more money to hand over to King Coal for Washington’s latest energy welfare scam, clean coal technology.

Now I’m not saying domestic wind energy growth is going to fall off a cliff; there are still plenty of wind farms currently under construction.

And going into 2011, we also expect to see more established wind developers picking up uncompleted wind farms for peanuts.

This is what Plutonic Power Corporation (TSX: PCC) did with GE (NYSE: GE) last year. The two companies picked up an uncompleted 144 megawatt wind project in northeast British Columbia at a deep discount.

But if you’re looking for volume, China is clearly the place — at least over the next few years.

So here are a couple of the bigger China wind players that will get a lot of attention 2011…


Based on installed capacity, Sinovel is China’s top wind turbine manufacturer. The company has been planning an IPO, although the China Securities Regulatory Commission recently canceled a meeting to consider the company’s offering.

In the meantime, one way to play Sinovel is through American Superconductor (NASDAQ: AMSC), which has million-dollar contracts with Sinovel to provide electrical components. Through AMSC’s Windtec subsidiary, the two companies are also jointly developing 3 and 5 MW wind energy systems that Sinovel plans to market globally.

Xinjiang Goldwind (HKG: 2208)

At of the end of Q2 2010, Goldwind had more than 6,000 turbines in service. It’s a major player in China, and also ranks among the top five global wind companies in terms of market share.

The company has also established a subsidiary in the United States called Goldwind USA.

An American in Beijing

GE is also capitalizing on China’s wind development. The company has already supplied the Middle Kingdom with almost 1,000 wind turbines.  And just a couple months ago, the company announced a joint venture with Harbin Power equipment to manufacture new turbines for both onshore and offshore wind projects.

Incidentally, GE also announced earlier this month it will invest more than $2 billion through 2012 in China to set up joint ventures with Chinese companies. More than $1.5 billion of that will be used to fund technology and financial services joint ventures with Chinese State-owned enterprises.

It’ll certainly be interesting to see next year how much (or how little) damage Washington will do to our already fragile energy economy…

But make no mistake; even if we lose the global clean energy race (which is how it’s starting to look at this point), we will still eventually transition a significant portion of our power generation to alternatives. The basic fundamentals of supply and demand will see to that.

We also know China wind development will continue to grow in 2011, and that countries such as Canada, India, Israel, Turkey, and South Africa remain focused on growing their wind and solar industries.

In fact just last week, South Africa signed a deal with Chinese solar player Yingli (NYSE: YGE) to build a $435 million manufacturing plant with a local partner.

It’s happening, my friends. Maybe not as much in the U.S. as we’d like, but on a global scale, this is happening.

And we’re going to continue to squeeze every penny we can out of this clean energy transition.

Make no mistake about that!

To a new way of life, and a new generation of wealth…

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